ECB launches staunch defence of cash

Typical EU head in the sand ! They’ll be trying to push back the tide soon

Not very far.reaching, unfortunately. Burocrats hold us back. Also odd remark about it not being true that cash fosters criminality, unless he does not see tax evasion and money laundering as criminal.

This is very concerning considering that most illegal activities, monely laundering and funding of terrorist activities etc are utilising cash. Digitalisation offers a solution to all the supposed benefits listed of cash PLUS the advantage of a full audit trial - If only it was easier to open a bank account. By keeping the barriers to financial access in place, the "baddies" will always find the route of least resistance - cash. Problems become worse not better. 

What about the European Union digital agenda? The Payment account directive, the Payment sevices directive 2, the Consumer finance action plan and other regulations in the market place sponsoring the electronic payment development as well as the growth of e-commerce? Does not the central bank see a change for the status of cash as a "must take" payment means?

Bitcoin, a digital alternative to cash, is far more likely to be used by criminals and corrupt regimes. I suspect that it is the currency of choice for North Korea to buy it's nuclear arsenal.

The majority of comments just show that most readers are 'digital utopists', who imagine a perfect world where everyone is happy and satisfied with what their government decides is best for them. The lack of understanding of finance and financial history is also startling.

How can one say that 'digitalisation offers a solution to all the supposed benefits listed of cash PLUS the advantage of a full audit trial'? How is privacy compatible with a full audit trail? If privacy existed on an audit-trail, then the audit trail would be meaningless, and if it didn't, then how is private?!

As a society, do we really suffer more from crime committed by cash users, or is it large corporates being involved in semi-legal tax evasion via the use of tax havens? Did the Bank of Bangladesh theft and the HSBC money laundering charges by the US regulator and a $2 billion fine in 2012 involve cash?!

It is ridiculous to claim that 'cash fosters crime' any more than any means of payment fosters crime. As the previous poster mentioned, I would not be surprised if Bitcoin or any of the other major cryptocurrencies are facilitating the circumvention of laws (such as Chinese capital controls) or North Korean sanctions on a much much larger scale than cash, while offering no tangible benefits for law-obiding small users.

Cash is the transaction method of last resort during periods of crisis or natural disaster. We noted in Florida, Peurto Rico, Houston in 2017, after the natural disasters that hit those areas, electronic payment methods were no longer available, access to bank accounts was cut off and cash,  (or barter) was the only way to purchase goods, pay for contactors to restore services, and to survive. If cash was not available during these periods of crisis, people would starve, power would not be quickly restored, infrustracture would not be rebuilt, and some citizens might die. 

It is indeed sad if, in a modern society like the USA, you need cash in order not to die in starvation in connection with a natural disaster in a small part of the country. Same also if contractors that restore damaged power lines demand cash payment from the national power grid! We in the payments industry should however use tools already available to us to enable electronic payments also when telecom does not work or when the electricity mains are down in disaster situations. A good part of this is already possible within the existing chip card specifications and battery technology today can drive entire cars, why not payment terminals...

In case the electric power system and telecom connections are down you will not be able to access cash through any ATM's either. Here in Sweden we are facing a situation where cash is now used in such a small fraction of POS transactions that it is becoming obsolete within a very short time frame. Politicians are considering measures to force both merchants and banks to accept and supply cash. This would come at a high cost for the society, only to meet the needs of very few individuals.  

It is indeed sad, Hurricane Maria hit Puerto Rico on September 16, 2017 and three months later more than half of the island population was still without power and many people are still without access to potable water, a safe food supply and a method to transact other than cash. To be distributed water must be pumped, and pumps need electricity. Battery technology will not last for three months, stored value chip cards are almost non-existent in the USA, our Debit and Credit cards are online Chip and Signature (mostly). When grid power is down, no amount of generators are going to cut it because power is used to dispense fuel. No generator or transport can run, because batteries cannot be recharged, and petroleum based fuels cannot be distributed.  

How many miles can you drive with a single charge of your electric car, 250km? Then what?

Looking for a use case study for retaining cash, look to Puerto Rico.